International environmental law aspects of the South China Sea Arbitration Award

By Līza Leimane

On 12th of July 2016, an arbitral Tribunal under Annex VII of the UN Convention on the Law of the Sea (UNCLOS) handed down an Award in the case of the Republic of thePhilippines v People’s Republic ofChina in the matter of the South China Sea Arbitration (PCA Case Nº 2013-19). Environmental aspects formed a considerable part of the 479 pages long Award, and they will be addressed in detail in this piece. The major considerations of environmental issues were included in submissions 11 and 12(b), as presented by the Philippines. These two environmental submissions were related to China’s conduct in two different scenarios: China’s tolerance of harmful fishing practices by its nationals, and the harmful construction of artificial islands and installations on reefs. Philippines sought declarations from the Tribunal that China had violated its obligations under UNCLOS, because it had failed to protect and preserve the marine environment. Some attention will also be paid to the announcement by China that it will not implement the Award.

Due Diligence

When considering submissions 11 and 12(b), the arbitral Tribunal had to assess if China had fulfilled its obligations under the Convention. Articles 192 and 194 UNCLOS were the articles assessed in that regard. Article 192 refers to the protection and preservation of the marine environment, while Article 194 refers specifically to marine pollution. The Tribunal noted that the obligations of States under these two articles extend beyond activities taken directly by States, and encompass activities that are undertaken within areas under their jurisdiction and control. In the interpretation of the obligations, the Tribunal has recognized that they require ‘due diligence’. The interpretation of the obligations has also referenced back to the body of international environmental law. The arbitral Tribunal refers to the International Tribunal for the Law of the Sea (ITLOS) Fisheries Advisory Opinion, which requires states to investigate reports by other states on the non-compliance of their vessels with the Convention,[i] as well as to the remarks by the International Court of Justice (ICJ) on due diligence in the Pulp Mills on the River Uruguay case, requiring a “certain level of vigilance”.[ii]

Article 194(5) UNCLOS covers all measures taken under Part XII that are necessary to preserve and protect “rare and fragile ecosystems” as well as the habitats of endangered species. Based on the scientific evidence that had been presented to the Tribunal, there was no doubt that the marine environments under question were “rare and fragile ecosystems” and that they formed habitats for “depleted, threatened or endangered species”. In the interpretation of the Article, the Tribunal also drew on wider international environmental law. First it drew on the Convention on Biological Diversity (CBD), specifically Article 2 CBD, because UNCLOS does not provide a definition for the term ‘ecosystem’ and so the Tribunal looked beyond the Convention. The Tribunal also held the views that CITES (to which both Philippines and China are parties to) informs the content of the Article. CITES was considered by the Tribunal, because it concerned sea turtles that were found on board of Chinese fishing vessels – they that were listed under Appendix I of CITES as a species threatened with extinction. This allowed to hold the view that the marine environments in question were indeed habitats of “depleted, threatened, or endangered species”.

The arbitral Tribunal noted that due diligence required under Article 192 UNCLOS is not only for the adoption of rules on protection and preservation measures, but also for the enforcement of such rules and measures to ensure that the marine environment is protected and preserved. Based on the facts, the Tribunal was satisfied that China had both tolerated and provided protection to poaching that was undertaken by Chinese nations. The Tribunal also noted that the widespread harvesting of giant clams using the highly destructive propeller chopping method to break up coral and release the clams was leading to the destruction of the coral reefs. It stressed that Article 192 UNCLOS extends to the prevention of harms that would affect depleted, threatened, or endangered species indirectly through the destruction of their habitat. The Tribunal concluded that China had breached its obligation of due diligence, despite the fact that it had relevant protection and preservation rules and measures in place. With regards to the use of cyanide and explosives, the Tribunal stated that Philippines had not provided sufficient evidence, and so China could not be held responsible for a lack of due diligence in the prevention on using these techniques.

Environmental Impact Assessment

The Award also makes contribution to the international environmental law jurisprudence regarding Environmental Impact Assessment (EIA). China did not participate in the proceedings, but there were repeated claims by Chinese officials that the construction works carried out in the reefs had been subject to environmental evaluation. The court sought to pinpoint Chinese expert opinions by examining several documents that were produced by Chinese-funded scientific organisations. Furthermore, the Tribunal also invited China (and the independent experts as well as the Philippines) to identify and provide a copy of the EIA that was carried out for these construction works. Despite Chinese assertions that it had undertaken an environmental evaluation, no report was identified that resembled an EIA in content and met the requirements of Art. 206 UNCLOS or Chinese Environmental Impact Assessment Law. The Tribunal also cited the ICJ judgement in Nicaragua v Costa Rica on this issue, where it was stated that an assertion by a state that is has performed a preliminary assessment of environmental risk does not mean that such an assessment has actually been conducted.[iii]

Under Article 206 UNCLOS the requirement to carry out on EIA exists if the party has ground to believe that the proposed activities could pollute or harm the marine environment. The Tribunal noted that China did have reason to believe that its constructions ‘may cause significant and harmful changes to the marine environment’. Hence, China was obliged to carry out an EIA and communicate the results. The Tribunal also noted that the preparation and communication of an EIA is a direct obligation under UNCLOS. The Tribunal could not find proof that China carried out an EIA, but it could not definitively state that China had failed to do so either due to constant assertions about environmental assessment by Chinese officials. However, the Tribunal did find China in breach of its obligations under Article 206 because the EIA and its results were never communicated.

Use of independent expertise

One of the notable aspects of this Award, is the reference to reports of experts that were appointed by the Tribunal. This was done to assess the environmental impact of China’s construction activities on the various reefs. The independent experts were appointed to ensure that Philippines claims were well founded, given that China did not participate in the proceedings.

The Tribunal accepted the conclusions drawn by the independent experts, which stated that China’s construction activities had caused environmental harm. Since China reiterated numerous times that its construction activities had followed high environmental standards, the Tribunal asked both the independent experts and the experts appointed by the Philippines to locate any claims of Chinese scientists on the consequences of the construction activities. Furthermore, the Tribunal also invited China to comment on the alleged environmental impacts of its construction activities. In the end the Tribunal was satisfied that China’s construction activities on reefs had caused long-lasting environmental damage – China had violated Articles 192, 194(1) and 194(5) of UNCLOS.

Implementation

Since the beginning of the proceedings, China has argued that the PCA does not have jurisdiction on the issues. The Court rejected China’s objections and since then, Beijing has refused to participate in the proceedings and stated various times that it will ignore the Award handed down by the Tribunal.[iv] Since the Award was issued, Beijing has held an even stronger stance on the issue, now claiming sovereignty over all land features in the South China Sea,[v] which could further aggravate the issue with neighbouring states.

While the Chinese stance of non-implementation has been criticised by many, including the United States, China’s position is not surprising especially given the actions of major powers in the past regarding PCA judgements. The country is following a precedent that has been set in the past by other big states. In fact, none of the Security Council permanent members have ever complied with a PCA judgement on the Law of the Sea. Hence, it is not surprising that China is following those same footsteps.

Potential implications of the decision

Paul S. Reichler, who was on the Philippines legal team, has stated that the Award is important because “this is really the first case to go to judgment over environmental provisions of the Law of the Sea”[vi]. While the case was not singularly on environmental issues, it could set a precedent – other governments could be held responsible for damaging the oceans under the Law of the Sea.

What also makes this Award interesting, is that often international tribunals and courts are not eager to utilise independent experts, especially in environmental cases. However, this Award could be seen as an example of how international tribunals can utilise independent experts to test the various claims of the parties while also remaining in control over the eventual conclusions on the facts and their legal characterisation.

While it was recognised by the Tribunal that the environmental damage done was significant, it also notes that the damage done cannot be undone and no remedies for environmental damage were provided under the Award. Furthermore, given the political situation with regards to the wider dispute it is unlikely that a willingness to engage in cooperation will emerge between the states. Hence, despite the developments in international environmental jurisprudence it is clear that the environment in the South China Sea lost out.

The Tribunal noted that there was a duty to not aggravate or extend a dispute that is before an international tribunal. More details on that can be found HERE.

[i]Request for an Advisory Opinion Submitted by the Sub-Regional Fisheries Commission (SRFC), Advisory Opinion, 2 April 2015, Advisory Opinion International Tribunal for the Law of the Sea 3, at 34 and 40.

[iii] Construction of a Road in Costa Rica along the San Juan River (Nicaragua v. Costa Rica), Judgment, 16 December 2015.

[iv]Graham Allison, Of Course China, Like All Great Powers, Will Ignore an International Legal Verdict, 11 July 2016, available online at: http://thediplomat.com/2016/07/of-course-china-like-all-great-powers-will-ignore-an-international-legal-verdict/

The latest climate summit ended in the afternoon of 13 December 2015, almost two days behind schedule, with the approval of the Paris Agreement. The 21st session of the Conference of the Parties (COP 21) to the 1992 UN Framework Convention on Climate Change (UNFCCC) successfully concluded the mandate that had been agreed upon at COP17 in Durban, South Africa in 2011. There, the Ad-hoc Working Group on Enhanced Action under the Durban Platform (ADP) was created and the year 2015 was set as last possible deadline to establish a new climate regime for the post 2020 period.

COP21 concluded years of intense negotiations. The Kyoto Protocol, adopted under the 1992 UNFCCC and setting out greenhouse gas emissions reduction obligations only for developed states, is nowadays left to a handful of developed countries and currently covering the period 2013-2020. According to COP13 in Bali, a new global climate agreement should have been adopted by 2009, in order to continue efforts to stop the climate from changing too much. The Copenhagen deadline was missed, however, notably because of the failure by COP15 to adopt the Copenhagen Accord. The new deadline agreed upon by COP17 in Durban mandated the ADP “to develop a protocol, another legal instrument or an agreed outcome with legal force under the Convention applicable to all Parties” at the latest by COP21.

The ADP held several inter sessional meetings in the four years between Durban and Paris, and concluded its work during the first week of COP21. It did so by launching a contact group to consider crosscutting issues and to unlock the work on the text of individual articles in the draft agreement and decision text.

By the closure of the ADP on 5 December 2015, its outcome was transmitted to the COP that established the Comité de Paris under the COP 21 Presidency to continue work on the draft agreement and decision text. The Comité de Paris convened for the last time in the evening of Saturday 12 December 2015 to forward the final text of the Paris Agreement and associated decision to COP 21 that successfully adopted both instruments at 7:29 pm of the same day. The Paris Agreement annexed to decision 1/CP.21 includes 16 preambular clauses and 29 operative clauses (annexed to FCCC/ CP/2015/L.9/Rev.1).

The main elements of the Paris Agreement are summarized here below:

Global objective (article 2): Parties agreed to strengthen ‘the global response to the threat of climate change’ by ‘holding the increase in global average temperature to well below 2°C above pre-industrial levels and to pursue efforts to limit the increase to 1.5°C’, since this would significantly reduce risks and the impacts of climate change;

Nationally Determined Contributions (NDCs) (article 3): the concept and rationale behind the 185 Intended Nationally Determined Contributions (INDCs) presented by all Parties before Paris is confirmed and remain the skeleton of the fight against climate change for the period after 2020. The NDCs also represent the strongest difference of the new regime compared to the Kyoto Protocol and the Copenhagen Accord, because of its voluntary nature and the complete lack of common parameters to verify their actual implementation;

Mitigation and ambition (article 4):

global peaking of greenhouse gas emissions to be reached as soon as possible

NDCs to be communicated every five years with the view to represent a progression beyond the Party’s current NDC and reflect the highest possible ambition

NDCs to be recorded in a public registry

Parties’ accounting for their NDCs to be determined by the Conference of the Parties serving as the meeting of the Parties to the Paris Agreement (CMA)

REDD+ (article 5): Parties are encouraged to take action to implement and support REDD+ activities

Market (article 6):

Parties can use cooperative approaches that involve the use of internationally transferred mitigation outcomes to achieve their nationally determined contributions

A mechanism to contribute to the mitigation of greenhouse gas emissions and support sustainable development is established

Adaptation (article 7):

A global goal is set on adaptation of enhancing adaptive capacity, strengthening resilience and reducing vulnerability to climate change

‘Each Party should, as appropriate, submit and update periodically an adaptation communication’

Loss and damage (article 8):

The ‘Warsaw International Mechanism for Loss and Damage may be enhanced and strengthened’, which means that negotiations will continue on the extent to which the Mechanism created in Warsaw will be operationalised

Countries also acknowledge the need to cooperate and enhance the understanding, action and support in different areas such as early warning systems, emergency preparedness and risk insurance.

Finance (article 9):

Developed countries will continue to support climate action to reduce emissions and build resilience to climate change impacts in developing countries;

Developed countries intend to continue their existing collective goal to mobilise USD 100 billion per year until 2025 when a new collective goal will be set.

Technology development and transfer (article 10):

Parties are to ‘strengthen cooperative action on technology development and transfer’

A Technology mechanism is established

Capacity building (article 11): Parties should cooperate to enhance activities in this domain through appropriate institutional arrangements

Transparency (article 13): ‘an enhanced transparency framework for action and support, with built-in flexibility which takes into account Parties’ different capacities and builds upon collective experience is established’

Global stocktake (article 14): in 2023, the first global stocktake assesses the collective progress towards achieving the purpose of this Agreement and its long-term goals

Compliance (article 15): a mechanism to facilitate implementation of and promote compliance with the provisions of this Agreement is established

COP 21 also launched several work programs and activities to be conducted by the subsidiary bodies. Those activities will define many important details of the functioning of the new regime for the coming years, until 2020 when the Paris Agreement will have to come into force.

The Paris Agreement undoubtedly forms a milestone in the fight against climate change. It sets the framework for the first global common action against greenhouse gas emissions, by both developed and developing countries. The upcoming period will tell whether the structure and rules of the new treaty form a workable framework to tackle climate change and keep the global temperature rise well below 2C above pre-industrial levels. One of the first challenges in this respect will be to strengthen the commitments of the parties, as the combined effect of their current contributions would bring up the temperature far more than 2C.

Norway's Coal Divestment: An Example to Follow

By Katarina Hovden

Introduction

On the 5 June 2015, the Norwegian Parliament voted unanimously to divest Norway’s $870 billion sovereign wealth fund from coal. The Government Pension Fund Global is the largest sovereign wealth fund in the world. As the biggest divestment from coal until date, this announcement gives great impetus to the divestment campaign and may incentivise other States and investors to follow suit. The text that follows will explain what the fossil fuel divestment campaign stands for, give background information about the Government Pension Fund Global (GPFG) generally, explain the process that led to the unanimous vote to divest and finally reflect on what lies beyond divestment.

The Fossil Fuel Divestment Campaign

Divestment entails the opposite of an investment, it means selling stocks, bonds or investment funds in particular companies, on the basis, for example, of moral and ethical reasons. The fossil fuel divestment campaign takes the standpoint that fossil fuels pose a risk to investors, to the climate system and to human beings and other living things, who rely on a stable climate for survival. The campaign demands divestment from the fossil fuel industry, as a matter both of risk mitigation and moral obligation.

Divestment campaigns have been successful in the past, for example in addressing the use of landmines and tobacco advertising and in engendering widespread condemnation of apartheid in South Africa, through divestment from companies that were doing business there.

The fossil fuel divestment campaign has received prominent endorsements from the United Nations Framework Convention on Climate Change (UNFCCC), the United Nations Environment Programme, UN Secretary-General Ban-Ki Moon, the President of the World Bank, US President Barack Obama, and more. It is in this context of growing support for the campaign, coupled with the upcoming UNFCCC’s 21stConference of the Parties(COP21) in December, that Norway made its announcement to divest.

Norway’s Government Pension Fund Global

Norway’s Government Pension Fund Global (previously known as Petroleum Fund) was established in 1990 as a fiscal policy tool with a mandate to support government savings to finance public pension expenditure and to underpin long-term considerations in the phasing in of petroleum revenues into the Norwegian economy (s. 1 Government Pension Fund Act). It has a long-term orientation, aiming to invest petroleum revenues responsibly and thereby also ensuring inter-generational equity, i.e. enabling both present and future generations to benefit from Norway’s petroleum revenues. Despite its name, the GPFG has no formal pension liabilities. The GPFG’s capital is entirely invested abroad, in international equity, fixed-income markets and real estate.

The Ministry of Finance is legally mandated to manage the GPFG under Section 2 of the Government Pension Fund Act, while Norges Bank Investment Management carries out its operational management. Notably, the Ministry of Finance and Norges Bank Investment Management manage the GPFG on behalf of the Norwegian people, on the understanding that its capital is common property. Norges Bank Investment Management must aim for the following: to achieve the highest possible return, to ensure that GPFG is not invested in companies that are excluded under the relevant provisions for exclusion and to manage the GPFG responsibly, while considering that good returns in the long term are dependent on sustainable development (in economic, environmental and social terms) and on well-functioning, legitimate and efficient markets (§1-3 Management Mandate).

An Ethical Council was established in 2004, whose responsibility it is to advice the Ministry of Finance on the extent to which an investment is in conflict with Norwegian law, and on whether certain companies should be excluded, considering whether continuing to invest in those companies would entail an unacceptable level of risk that the GPFG would contribute to grave and systemic human rights violations, serious environmental damage, and more.

Coal and Petroleum under the Spotlight

In April of 2014, the Ministry of Finance appointed an Expert Group (the Skancke Committee) to evaluate GPFG’s investments in coal and petroleum companies, and more specifically to determine whether the exclusion of coal and petroleum companies would be a ‘more effective strategy for addressing climate issues and promoting future change than the exercise of ownership and exertion of influence’ (Mandate for Expert Group).

The Expert Group concluded, in their Report of the 3 December 2014, that no general and automatic exclusion mechanism for coal and petroleum producers should be created. Instead, ‘corporate governance’ should be the GPFG’s main vehicle for addressing climate change and an ad-hoc exclusion mechanism should be incorporated into the Guidelines for Observation and Exclusion, namely ‘contribution to climate change’, so that companies that contribute to serious damage to the climate could be excluded from the GPFG on a case-by-case basis.

The Group gave the following reasons for this decision: automatically excluding all coal or petroleum producers from the GPFG would not in itself impact greatly on the extent of climate change; fossil fuel companies’ energy production, energy use and emissions are not per se contrary to accepted ethical norms, as in fact society relies on such fuel; and a general coal and/or petroleum exclusion criterion would be inconsistent with other Norwegian policies, given the Norwegian Government’s role in the production of petroleum and coal.

The Group’s conclusions were criticised and Parliamentary representative Rasmus Hansson re-opened the issue in Parliament in a recommendation of the 4 December 2014. In that recommendation, two proposals were made:

Parliament should ask the Government to pull the GPFG out of coal companies (notably, not petroleum); based on quantitative criteria for how heavily the company is involved in coal. This is the ‘product-based’ criterion.

Parliament should ask the Government to propose that the GPFG’s Guidelines for Observation and Exclusion should be extended to include ‘activities that are harmful to the climate’, based on a risk assessment that takes the two-degrees Celsius target into account. This is the ‘conduct-based’ criterion.

The Ministry of Finance concurred with Rasmus Hansson’s two proposals and recommended that Parliament adopt them. Consequently, the matter came to a vote on the 5 June 2015.

Unanimous Verdict= Divest

On that date, the Norwegian Parliament voted unanimously in favour of both the product-based and the conduct-based criterion, and consequently took decisive action to pull the GPFG out of coal companies. More specifically, the Norwegian Parliament decided that the GPFG will pull out of its investments in companies that have 30% or more of its business in coal or where 30% or more of a companies’ revenue comes from coal. Moreover, the decision will also cover subsidiary companies, so that companies cannot subcontract their coal production and thereby avoid exclusion. This is an important safeguard, in particular in light of companies’ long chains of command. Moreover, the Norwegian Parliament adopted the conduct-based criterion relating to ‘activities that are harmful to the climate’ (also recommended by the Expert Group).

The Ministry of Finance has calculated that the measures, which will enter into force on 1 January 2016, will affect $5-6 billion of investments and 70-80 companies (of more than 9000 companies), while a group of NGOs (Urgewald, Greenpeace, Fremtiden i våre Hender) has calculated that it will affect $8.7 billion and 122 companies.

Beyond Divestment: Clean investments

Despite the scepticism of the Expert Group, the GPFG’s divestment from coal and petroleum is significant. As the largest sovereign wealth fund in the world, GPFG’s divestment could have a tangible impact on the companies affected by the exclusion measures, and on their emissions, and it certainly carries a global political message. This global political message should not be undermined, in particular given the current international climate and efforts to work towards a new climate agreement in Paris at the end of 2015.

While undoubtedly the GPFG’s divestment from coal could have a ripple effect and incentivise other investors to divest, it does not address clean investments. Environmental investments are already a part of the GPFG’s mandate, which in the year 2013-2014 was set at $3.6 billion to $6.1 billion. While the Ministry of Finance recommended increasing the mandate in 2014-2015, to between $3.6 billion and $7.3 billion, this is arguably a modest increase, and one which has been criticised by some as unduly cautious. As a point of reference, the GPFG currently has somewhere between $30 and $40 billion invested in fossil fuel industries.

It is to be hoped that, in addition to further divestment pledges, greater attention will be given to clean investments, and to mandating, at a national and international level, a greater proportion of such investments. While the COP21 could be one such forum in which to make a commitment to increase the proportion of clean investments, and the negotiating draft text in fact includes many references to climate-resilient and low-emission investments , the draft text is vague and does not propose quantifiable objectives or obligations. Additionally, there is no guarantee that clean investments will be addressed at all at the COP21, and if addressed, it is unlikely that any potential agreement will mandate quantifiable objectives or obligations relating to clean investments.

For the time being, it will be up to national or regional governments and investors such as pension funds to follow the Norwegian example and opt for climate-friendly investments. California is heading in this direction by adopting legislation that will oblige its state pension funds not to invest in coal any more, and other US states have similar plans. In the Netherlands, one of the largest pension funds in the world announced that it will take climate change better into account, but calls for further steps– such as that taken in Norway- are growing louder.

Obama announced his Clean Power Plan on 3 August 2015. It aims at tackling greenhouse gas emissions from power plants in the USA. The legal basis for the plan is Section 111(d) of theClean Air Act (CAA), which requires the Environmental Protection Agency (EPA) to set limits on air pollutants generally and on the emissions of air pollutants from particular sources such as power plants, and gives states (and tribes) the power to choose how to meet those targets. In this brief dossier, some background information on the way in which the EPA got involved in tackling climate change is offered, followed by more detail on the current Plan and on the likelihood of it facing legal challenge.

The reluctant start of EPA’s involvement with climate change

The duty to regulate air pollutants that can “reasonably be anticipated to endanger public health or welfare” was present in the CAA from its start, but for a long time the EPA was reluctant to use this power where climate change was concerned. In 2003, the EPA denied a petition to regulate greenhouse gas emissions from motor vehicles, in spite of the fact that the transportation sector forms one of the largest sources of greenhouse gas emissions in the US. The EPA did so because in its view, it did not have authority under the Clean Air Act to regulate CO2 and other greenhouse gases for climate change purposes. Even if it would have this authority, the EPA added, it had discretion to defer a decision until more research was done on the causes, extent and significance of climate change and the potential options for addressing it. Setting GHG emission standards for motor vehicles was not appropriate at that moment in time, it argued.

In the case Massachusetts et al. v EPA et al. (549 U.S. 497 (2007)), the US Supreme Court found in a 5-4 verdict on 2 April 2007 that the EPA decision was incorrect because “greenhouse gases fit well within the CAA’s capacious definition of air pollutant”, and because the EPA’s rationale for not regulating was inadequate. This Supreme Court decision opened the door for EPA’s 2009 ‘endangerment finding’(explaining that science shows that greenhouse gases endanger both the public health and the public welfare of current and future generations) and EPA regulation of carbon dioxide-emitting sources. Following this finding, the EPA issued its 2010 and 2012 rules on the fuel economy and greenhouse gas emissions of cars and light-duty trucks. The latest rules call for a strong decrease in greenhouse gas emissions. With the climate change aspects of transport being regulated, this left the other largest source of greenhouse gas emissions to be tackled: the US power industry. This is what the Clean Power Plant intends to do in the following manner.

The Clean Power Plan

The Clean Power Plan applies to fossil fuel-fired electric generating units (coal, oil and natural gas-fired units). The Plan is composed of three parts:

– Existing power plants must emit 32 percent less CO2 from 2005 levels by 2025;

– Power plants that are built in the future must produce ca. half the rate of pollution produced by existing power plants;

– States must draft emission reduction plans in 2016, finalising their plans by 2018. States are given flexibility to decide how to meet their targets, and they may do so using renewable energy sources.

In announcing the Clean Power Plan, Obama referred to the Pope’s encyclical and noted that taking action on climate change is a moral obligation. Moreover, the benefits that can be expected from implementing the Plan would include: public health benefits (such as reducing premature deaths from power plant emissions by 90% in 2030 compared to 2005), creating thousands of jobs, driving more aggressive investment in clean energy technologies, saving the average American family nearly $85 on their annual energy bill in 2030 and saving consumers a total of $155 billion from 2020-2030.

Power plants currently account for a third of US emissions of CO2. The Clean Power Plan is expected to help the US to meet its Intended Nationally Determined Contribution (INDC), submitted ahead of the Paris talks at the UNFCCC’s COP21, where the US has pledged a 26-28% overall emissions reduction from 2005 levels by 2025.

Reactions to the plan

Despite the positive attention that the Plan has received, in particular for the signal that it sends to the international community in the build up to COP21, others have commented that it does not go far enough for the US to be able to meet its INDC.

Domestically, moreover, Obama has had to face fierce opposition from lawyers and lobbyists, who expressed their intent to challenge the Plan before the Supreme Court as soon as Obama made his announcement. They are expected to argue, inter alia, that the EPA has overstepped the powers it has been conferred through the Clean Air Act. That strategy proved to be successful recently, in another 5-4 US Supreme Court decision (Michigan et al v Environmental Protection Agency et al, 29 June 2015) concerning the EPA’s rules on mercury, arsenic and other toxins. The US Supreme Court struck down the EPA’s rules, which had set limits on the amount of such toxins that power plants could emit into the air, lakes and rivers. It held that they were prohibitively expensive and amounted to government overreach.

Given this recent Supreme Court decision, and the previous cases against legislation adopted under the Clean Air Act, it is likely that Obama’s Clean Power Plan will be the topic of further legal action in the USA. The costs and benefits of tackling climate change in the manner foreseen in the plan could very well be a decisive factor for the outcome of such legal action.

The Environmental Legacy of Sochi: Time to Take the Olympic Charter Seriously!

By Antoine Duval, Senior Researcher at the T.M.C. Asser Institute in The Hague

The Sochi Olympic Games have drawn to a close. Many facets of these Games have come under fire from critical commentators: the price tag, the climate, the human rights violations, the low attendance, the quality of the hotels, the list goes on… At the closing ceremony, however, IOC President Bach complimented Russia for “delivering on all that it promised.” Considering environmental promises and the actual damage to the environment in Sochi, a different point of view on the environmental legacy of these Olympic Games will be set out here.

Sochi: The environmental disappointment
At the beginning, there was an assurance that the environment would not suffer. The Organizing Committee for Sochi promised “to apply a sustainable management system to the development of facilities and operations, sustainable design principles in construction and improved measures for waste collection, processing and disposal.” However, as highlighted by contradictory evidence, and despite President Bach’s praises, the promise was not kept. This was not an unforeseen development; the evaluation commission of the International Olympic Committee (IOC) itself had highlighted that the organization of the Winter Games in Sochi would be potentially destructive for the environment (1). Somewhat naively, it had acknowledged that “[s]even competition and non-competition venues required for the Olympic Winter Games would be constructed within the boundaries of Sochi National Park, directly impacting on approximately 800 hectares (0.5% of the total area of the park)” and mentioned the astonishing fact, for anybody even slightly concerned for the environment, that “[t]wo of these venues, the Krasnaya Polyana Olympic Village and the sliding venue, would be located in the buffer zone of the Caucasus State Biosphere Reserve – a UNESCO World Heritage site – where, due to a recent rezoning of Sochi National Park, the construction of infrastructure for tourism and recreation is now permitted.” Moreover, the UNEP, which was initially involved in monitoring the environmental commitments made, criticized the Sochi Olympics as early as 2010. Since then, NGOs have not ceased in pointing out the total neglect for environmental concerns at Sochi’s construction sites. Thevery recent example of judicial persecution against the few environmental activists fighting the negative side-effects of Putin’s prestige project reminds us of the tremendous obstacles they face in doing so. In the meantime, the IOC has turned a deaf ear to the many SOS’s sent out by environmental organizations.

Organized irresponsibility at the IOC
The German sociologist Ulrich Beck has developed, in his work on the Risk Society, the concept of organized irresponsibility to qualify the fact that we live in a society where nobody seems to be held accountable for the (environmental) risks one gives rise to (2). This concept fits well the attitude of the IOC. Here, we are confronted with an institution that calls into being every second year a gargantuan sporting event producing massive strains on the environment, without considering itself in any way responsible for their creation. This is the case despite the fact that the IOC is in charge of the selection of each Olympic City and that it is the sole institution determining the criteria on the basis of which the Games are attributed. The IOC is, according to its statutes, a private association that operates under Swiss Law. A priori it is of the opinion that it does not have the capacity to intervene in the affairs of a sovereign state. However, such a formalistic stance on the competence and power of the IOC is contradicted by the fact that it is very interventionist in practice. In particular, it uses its bargaining power to impose drastic conditions on candidate cities, be it in terms of economic guarantees or infrastructural investment. The IOC is a powerful institution in our transnational world, capable of bending the will of states and commanding the social conditions surrounding the organization of the Games. The environmental concerns (and blame) raised by the Olympic Games need to be addressed to the Lords of the Rings. In fact, it is only by submitting the IOC to the close scrutiny of the global public sphere that it might be coerced into enforcing its own constitution: The Olympic Charter.

A modest proposal: take the Olympic Charter Seriously!The Olympic Charter, “as a basic instrument of a constitutional nature, sets forth and recalls the Fundamental Principles and essential values of Olympism”. It states that “[t]he goal of Olympism is to place sport at the service of the harmonious development of humankind”. Furthermore, it is the IOC’s self-imposed mission “to encourage and support a responsible concern for environmental issues, to promote sustainable development in sport and to require that the Olympic Games are held accordingly”. Thus, we should modestly suggest that the IOC takes its own “Constitution” seriously. Indeed, the rise of private powers in the transnational space does not relinquish them of any kind of responsibility. Therefore, a process of self-constitutionalisation of transnational private regimes has been advocated (3). This implies that the values and principles highlighted as fundamental by the Olympic Charter, particularly in its preamble (one thinks also, in the context of Sochi, of the principle of non-discrimination), be considered as such in the IOC’s administrative practice.
More broadly, those values need to be given prevalence in the Olympic system and must underlie its complex net of rules. This would mean for example that the environmental criterion, which is nowadays allocated little weight, should be upgraded and considered a fundamental pillar in the evaluation process of the candidate cities. Indeed, in the case of Sochi, the evaluation Commission of the IOC was not that far-off concerning the potential for environmental degradation; however, the disappointing grade earned by Sochi on these grounds was not weighted sufficiently enough to be eliminatory. In addition to that, such an ex ante mechanism could be bundled in with binding commitments enforced by independent third-parties (environmental NGOs) that could be integrated into the existing ex post monitoring mechanisms used to oversee the organization of the games (e.g. the host-city contract). This would imply in case of non-compliance that the IOC disposes in parallel to the designated Olympic City of an alternative venue for the Olympic Games. Eventually, the IOC’s “blackmailing” on financial conditions and infrastructural investments, could also be turned into a “whitemailing” forcing the host city to adopt certain environmental and human rights standards under the shadow of withdrawing the Games. The IOC is far from being deprived of means to enforce environmental and human rights standards. To this end, it only needs to give flesh to those fundamental principles anchored in the suave wording of the Olympic Charter.

(2) The concept of ‘organized irresponsibility’ helps to explain how and why the institutions of modern society must unavoidably acknowledge the reality of catastrophe while simultaneously denying its existence, hiding its origins and precluding compensation or control. To put it in another way, risk societies are characterized by the paradox of more and more environmental degradation – perceived and potential – coupled with an expansion of environmental law and regulation. Yet at the same time, no individual or institution seems to be held specifically accountable for anything.” U. Beck, ‘Risk Society Revisited: Theory, Politics and Research Programmes’ in B. Adam (ed.) The Risk Society and Beyond, Sage, 2005, pp. 211-229, p.224

The 1992 Earth Summit in Rio de Janeiro has been named one of the most important environmental summits ever held, spurring a wide-ranging framework for action to achieve sustainable development. Twenty years later, Rio de Janeiro will host a follow-up Conference on Sustainable Development, and a series of related activities. With little chance of matching the original event, is there any reason for optimism towards Rio+20?

Unimpressive scale

The 14-day Earth Summit in 1992 gathered the highest government representatives from more than 100 countries, including George H. Bush and other key leaders. Although the Brazilian government pledges to make the United Nations Conference on Sustainable Development (UNCSD or Rio+20) the largest conference ever held by the UN, the event has been reduced to a modest three days. Hu Jintao, Francois Hollande and Vladimir Putin are the only heads of state who have confirmed attendance. German Chancellor Angela Merkel, British Prime Minister David Cameron, U.S. President Obama are not scheduled to attend. Neither is the European Parliament, citing a “huge increase in the estimated hotel costs”.

The reason behind the absences lies at least partially in the event’s draft outcome document entitled “The Future we Want”. Widely criticized for lack of ambition and singular focus on the environment, it had originally comprised over 6,000 pages of submissions by member states, international and non-governmental organizations. The draft that outlines a global action plan has been negotiated for months by representatives of all 193 UN member states. One month before the event, however, the UN preparatory committee failed to reach consensus on the final version. This is all the more disheartening since, as noted by the UNCSD secretary general Sha Zukang, the objective was to start the conference with “at least 90 percent of the text ready, and only the most difficult 10% left to be negotiated there at the highest political levels”. The impasse has been criticized by a coalition of NGOs led by Oxfam claiming the conference is “set to add almost nothing to global efforts to deliver sustainable development”.

By contrast, the 1992 Earth Summit spearheaded such efforts by tabling three groundbreaking conventions on climate change, biological diversity and desertification; as well as building a more sustainable and equitable regime through a comprehensive global action plan, Agenda 21, and the Rio Declaration. A number of follow-up mechanisms were put in place all at once, including the UN Commission on Sustainable Development.

Notwithstanding the plethora of binding and non-binding agreements signed at Rio, the two decades that followed have, to say the very least, fallen short on commitments on GHG emissions, resource management, biodiversity, water quality and education for sustainability. The recent UN reviews of the implementation of Agenda 21 state the obvious fact that the past two decades have seen multiple crises only accelerate.

Unlike its predecessor, Rio+20 will almost certainly not yield further legally binding commitments. Perhaps an alternative based on voluntary, yet realistic commitments could prove effective in addressing global pressures and merit organising this major event. In response to international submissions,[1] the “zero draft” zooms in on the concept of “green economy” which much like that of sustainable development depends entirely on the form of commitment that will eventually be taken.

Green economy – tool or alternative to sustainable development?

The green economy is one of the summit’s overarching themes, based on UNEP’s initiative guiding governments towards policies on- and investment in green technologies and practices. The zero draft defines it abstractly “as a decision-making framework to foster integrated consideration of the three pillars of sustainable development in all relevant domains of public and private decision-making”. In essence, it looks to ensure sound management of resources, enhance resource and energy efficiency, as well as promote sustainable consumption and production patterns, and a low-carbon economy.

While the draft claims to be framing the green economy in the context of sustainable development, at a conceptual level it is probably the closest to an alternative to the latter.[2] In that view, sustainable development as coined at the Earth Summit 20 years ago accepted economy as a force behind development and politics. The “sustainable” prerequisite, once appropriated by the mainstream capitalist economy and confronted with climate, poverty and economic crises, according to many has lost much of its potential for reconciling “the needs of the present without compromising the ability of future generations to meet their own needs”. An alternative, “green” economic model is expected to maintain growth while protecting ecosystems and contribute to poverty alleviation.

Most countries have rejected this view out of hand; stressing that green economy should be entirely anchored in sustainable development. The EU views green economy as a tool for pursuing the latter, since it best reconciles the objectives of environmental protection, economic growth, poverty eradication and social justice in this day and age. The G77 countries are much more suspicious of the concept, precisely because they question its adherence to the still topical sustainable development. During informal negotiations on the zero draft in New York last month, along with the U.S. and Canada, they objected to the framing of green economy as a roadmap. When seen as one of multiple tools for pursuing sustainable development, it should not be randomly prioritized by having its own roadmap, the opposing countries argue. Since some G77 members admitted not to know what green economy was and had never used this type of tool before, they further fear that it is not comprehensive enough to channel sustainable development, but merely its selected principles.

The zero draft in its current form remains too imprecise to ease those concerns. Meanwhile, the more detailed UNEP’s Green Economy Initiative is recognizably guided by the principles of the Rio Declaration on Sustainable Development. Those include international cooperation on eradicating poverty, capacity building and technology ( Principles 5 and 9); addressing special needs of developing countries (Principle 6); the principle of common but differentiated responsibilities (Principle 7); elimination of unsustainable production and consumption processes and promotion of appropriate demographic policies (Principle 8); public participation and access to information and justice (Principle 10); and acceptable trade policy measures for environmental purposes (Principle 12).

Operationalization and the New Delhi Principles

Owing to this general adherence to Rio principles, UNEP’s Green Economy Initiative is capable of informing policies towards transition from the industrial risk model. It gives criteria for public intervention in the area of environment and the economy, emphasized in many submissions to the outcome document, including that by Brazil. Yet, for this potential to be fully realized, one should take as a reference not only the general Rio principles but also one of their often overlooked successors, the New Delhi ILA Declaration on Principles of International Law relating to Sustainable Development. Formulated by the International Law Association at its conference in 2002, the seven principles of international law on sustainable development[3] were found already in most other international documents related to sustainable development, including the Rio Declaration and Brundtland Report.

What distinguishes the New Delhi Declaration from other sets of principles is that they are accompanied by guidelines on their operationalization, including a questionnaire for policy-makers. As a result, they are increasingly recognized as a normative context for best policies and laws in the field of sustainable development, as well as in local strategies for the implementation of Agenda 21. At the international level, the Netherlands at the 2002 World Summit on Sustainable Development in Johannesburg identified them as mechanism for policy-making, implementation and enforcement of laws within institutional frameworks for sustainable development.

Negotiations preceding Rio+20 show that the international community continues to try balance the imperatives of the environment and social and economic development through the equity principle. When shaped through the Rio and New Delhi principles, the concept of green economy will go beyond prescribing ecological policies. In the wake of heightening resource scarcity and dwindling energy supplies, the concept can contribute to making current processes of production and consumption more equitable, both domestically and internationally. By improving resource management to prevent overexploitation and ecosystem degradation, it could help accommodate the needs of both present and future generations. Therefore, green economy could form an appropriate response to three major challenges to be discussed in Rio: how to make growth more sustainable, particularly in developing economies; how to create equity amidst intensifying tensions over natural resources; and, finally, how to respond to crises already in motion, arising from both the strained natural environment and the global market.

Framework of action

The present reluctance towards the green economy has its roots in numerous sticking points that come with it. The zero draft fails to address the fundamental issue of how the green transition can improve management of the natural world. The problem of financing also remains unanswered, leaving questions of how to phase out subsidies for fossil fuels, unsustainable agriculture and fisheries, as well as stimulating investment in green technologies. How the green model can benefit – and not marginalize – the poorest by, for instance, posing trade restrictions is yet another unknown.

The roughly sketched green economy in the draft document has spawned a discussion on the framework leading towards it. The EU insists on a tangible outcome consisting of voluntary but concrete goals, targets, and modes of implementation, rather than general aspirations. These could in turn contribute to negotiations on the post-2015 framework, including the post-Kyoto regime and the future of Millennium Development Goals. The EU, currently negotiating its low-carbon Roadmap to 2050, expects the Rio outcome document to cover such topics as investment in sustainable infrastructure, public procurement policies that support greener goods and services, phasing out subsidies for environmentally harmful activities and introducing taxes on the use of energy and natural resources.

Conversely, the G77 countries reject the idea of new targets before the still valid commitments made at earlier meetings are renewed. They furthermore emphasize the flexibility necessary to fit in with country-specific economic, social and environmental conditions and, in the same vein, the importance of the principle of common but differentiated responsibilities. This view is shared by the United States and Canada who oppose a single green economy roadmap and instead propose nationally-determined goals.

Conclusions

The green economy concept has a potential of giving teeth to the aspirations set out at the Earth Summit of 1992. Under the umbrella of sustainable development, it can integrate efforts across multiple fields including, in broad strokes, protection of biodiversity, supporting mitigation and adaptation to climate change, and poverty alleviation. If the roadmap is guided by Delhi Principles, notably accompanied by concrete guidelines, some concerns of developing countries regarding implementation or unreasonable trade restrictions should prove unfounded.

Green economy can be the way to cut through the endless debate on how to operationalize the concept of sustainable development, provided it takes the form of a roadmap with clear targets and time frames, as advocated by the EU. This, however, may be wishful thinking, seeing that even in Europe stepping up green economy efforts faces strong opposition. The credibility of events to discuss global efforts towards sustainable development is crumbling under the miserably little progress made towards meeting the goals set in 1992, and the lack of new, adjusted measures. Can it be restored without eventual adoption of a concrete and realistic action plan? The concept of green economy is the closest to the latter, but can only constitute an added value to the existing mechanisms of sustainable development if coupled with targets and financing measures.

The Hague, 18 June 2012

Agata Walczak, with cooperation of Wybe Th. Douma

[1] The European Union, for example, calls for operational targets and a concrete global action plan on five priority areas: oceans, energy, land degradation, water, resource efficiency, and waste. Mexico proposes that a voluntary mechanism “should be used for accountability in the implementation of [agreed] commitments”, comprising national reports and exchange of experiences and best practices between States and observers.

[2] The more distinguishable alternatives such as the proposals for the Rights of Nature fostered by Ecuador and Bolivia, or the idea of sustainable de-growth explored within the EU Commission, have not received much attention from the negotiating governments.

[3] The New Delhi principles include: (1) the duty of States to ensure sustainable use of natural resources; (2) the principle of equity and the eradication of poverty; (3) the principle of the precautionary approach to human health, natural resources and ecosystems; (4) the principle of public participation and access to information and justice; (5) the principle of good governance; (6) the principle of common but differentiated obligations; (7) the principle of integration and interrelationship, in particular in relation to human rights and social, economic and environmental objectives.